Linc advancing Tyonek syngas plans

Linc Energy Ltd. plans to convert its exploration license in the Tyonek region into conventional leases and begin permitting a synthesized natural gas operation.

In financial filings from the end of August, the Australian independent said opportunities to produce and market synthetic natural gas to “existing and new participants” in the Cook Inlet region are “well progressed.” Having confirmed a “commercial pathway,” the company is now beginning the regulatory process for bringing an operation online.

While Linc is best known in Alaska for drilling a conventional onshore natural gas well in the northern end of Cook Inlet and for reviving a long-dormant exploration program at the Umiat oil field in the foothills of the Brooks Range, the company originally came to Alaska in early 2010 to pursue an underground coal gasification program.

The process is a method of synthesizing gas in underground coal seams too deep to mine traditionally. By injecting air and water into an ignited coal seam, an operator can prompt a chemical reaction that rearranges the carbon and oxygen into methane, or natural gas.

In February 2011, Linc received an underground coal gasification exploration license from the Alaska Mental Health Trust Land Office covering 181,414 acres across three areas of the state: near Tyonek, in the Interior region near Healy and on the Kenai Peninsula. Of those three areas, Linc has spent the majority of its resources on the Tyonek parcel.

In the filings, Linc also provided an update on Umiat. The company said it “remains in discussion with interested parties” to sell the oil field as well as oil properties in Wyoming. “While progress has been slow as a result of the recent oil and gas market downturn, the Company remains confident in the long-term value of both the Umiat and Wyoming oil assets and will continue to engage with interested parties whilst prudently progressing with permitting and development plans for the fields,” the company said.

In September 2014, after receiving “unsolicited expressions of interest” for Umiat and the Wyoming properties, Linc launched “a formal process to work with additional parties who have expressed an interest in the potential acquisition of the company’s entire USA based oil and gas portfolio.” The company said it would make a decision about a sale by the end of 2014, but the rapid decline in global oil prices has upended that timeline. The current financial filing is the first time the company provided a reason for the delay.

Over the past year, Linc has claimed to be advancing early engineering and permitting for Umiat development, which would require a massive infrastructure investment to bring to market.

- ERIC LIDJI